1st Investment Property

[Dustin A.]

BRRRR with a twist

This is my first investment property. I started listening to the BiggerPockets Podcast in October of 2018. I specifically remember listening to show 305 and thinking of how doable it all sounded. Then in December I started watching webinars and became a pro member so that I could use the calculators more. After putting in several offers just before New Years I got this one to stick.

Property#1

Property Address: Fayetteville, NC 28306, USA

Purchase Price: $36671

Rehab Cost: $20,000

ARV: $83000

Current Rent: $850

Cash on Cash: 13.6%

Vacancy: 3%

Property Management: 10%

Capital Expenditures: 5%

Maintenance: 5%

HELOC: $35,000

Monthly Cash Flow: $398

What I did- Financed the purchase with a credit union at 4.75%. Closed in February, did some rehab including adding a shower and had a renter May 1. Instead of a refi I used the equity for a HELOC. I didn't want to give up the cash flow and low interest rate.

What I will do again- Keep investing in real estate. The whole process I was learning and still have even more to learn. I will also work with Daniel Kidd and Shelby Osborne from Five Pillars Realty Group, Alotta Properties, TDudley and Kyle from Home Front Preservation and Restoration Inc and John Freudenberg from Silk Inspections. They all received barrages of questions and put up with it. I recommend all of them and can’t stress how important it was for me to have a good team since I was investing long distance.

What I would do differently- I started the whole process with dohardmoney.com. I definitely regret trying to work with them. They started off with promises of funding multiple deals at the same time. They were difficult to work with and getting solid answers was always a hassle with no one person to communicate with. After a long process they had some appraisals come back with a ARVs ranging from $73k-$100k and decided there wasn't enough profit, after I paid them for 3 appraisals. To top it off their website wasn't the most user friendly. I'm glad I went with the BRRHR but I'm going to stick with BRRRR from here on.

Special thanks to Joe Prillaman for also being willing to answer all my questions.